Can Matros bring Raven to the next level?

Sunday

Sep 30, 2012 at 6:00 AM

Peter Cohan WALL & MAIN

It's been a few weeks since Ron Matros took the reins at Marlboro's Content Raven. He has a track record of boosting the revenues of venture-backed startups and generating returns for investors. But Content Raven has no outside investors and getting some is one of his first priorities. Can Mr. Matros repeat his past startup magic?

In a Sept. 21 interview, Mr. Matros started off by telling me what Content Raven does. The concept is simple. Companies produce content such as memos, presentations and videos, and Content Raven keeps that content from getting into the wrong hands. For example, Content Raven makes sure that an engineer who has developed an electronic version of the blueprint for a company's new product can only send it to people authorized by the company.

Mr. Matros has worked with Content Raven for about a year, joining as chief executive officer in early September. He joked that “he was still learning how to use the phones,” but it's clear that he knew what he was getting himself into. Content Raven has developed a product that has generated enough revenue to keep the company operating without outside capital.

However, Content Raven's board saw the potential for the company to grow if it could get an infusion of capital, and Mr. Matros has experience in that area. Most recently, he was the CEO and president of Woburn-based Inmagic, and before that, he was an executive with mapping search vendor, MetaCarta.

Mr. Matros was also president of OpenMarket — a publicly traded ecommerce company — and FutureTense, where he managed each company and took over as CEO after merging them with other companies.

Content Raven is going after a huge market. Mr. Matros estimates that companies lose $25 billion annually from “content data loss” — when competitors get their hands on confidential information, for example. He sees this growth due to two trends: cloud-based technology such as online storage service DropBox, and what he calls “bring your own device to work” — when, say, an employee brings her personal iPad to work and puts corporate documents into its memory.

The idea for Content Raven came from founder, president and chief technology officer Vasu Ram. Mr. Ram was helping to train EMC engineers in India and was worried about sending the training materials to them electronically. The reason for his concern was that he feared those offshore workers might send confidential EMC product information to people who were not authorized to see it. In 2009, Mr. Ram decided that there was an opportunity to develop a product to solve this problem.

Mr. Matros believes that Content Raven — whose 25 customers and 40,000 “viewers” include employees at EMC, Gryphon Networks and Waters — has a competitive advantage over rivals such as WatchDox. He says that customers find Content Raven to be easy to install and use, to protect all types of content, and to give company executives detailed reporting on the trajectory of content — including information about who sends which content, and when, and to which recipients.

Content Raven offers companies three ways to use its product, and the more people who use it, the more it costs. Individuals can access it at no charge, or they can pay $10 per month per user to share the product with others in their organizations. But for big companies, that fee can get very steep if enough employees use the product. For such users, Content Raven offers companies the option of paying an annual fee ranging from $15,000 to $20,000 a year to “a couple of hundred thousand dollars a year” so that the entire company can use the product.

In 2013, Mr. Matros would like to see Content Raven get bigger. He wants to “double the number of people in the company, get more traction in more markets, add functionality to the product, and integrate with enterprise solutions such as customer relationship management system, Salesforce.com.”

And he will be exploring options for raising capital to finance that growth. Based on his experience in “content and commerce,” he has worked with dozens of venture capitalists and his goal will be to find the ones who he believes will understand the opportunity that Content Raven can offer.

Startup CEOs such as Mr. Matros generally stay in their jobs for two years, at most. They have a specific mission of getting venture capitalists a return on their investment, either by taking the company public or selling it to another company.

What is different now is that companies must have “more traction” in order to raise venture capital. This means companies these days can only attract venture capital, in his view, if they have more customers, more revenue, and better-developed products than they did in the 1990s.

Peter Cohan of Marlboro heads a management consulting and venture capital firm, teaches business strategy, and is the author of 10 books. His column runs Sundays and Wednesdays on telegram.com. His email address is at peter@petercohan.com.